Finance Minister of India


Shri P. Chidambaram
Finance Minister of India

2008.01.31


FM's statement on India's economic growth

Today brought good news for the economy.

2. According to the Central Statistical Organisation, GDP growth in 2005-06 was 9.4 per cent and in 2006-07, it was 9.6 per cent. The two growth rates have been revised upward from 9.0 and 9.4 per cent respectively.

3. Growth has been spurred by investment. Both savings and investment have risen in the past three years. According to revised estimates, the savings to GDP ratio and the investment to GDP ratio in the three years of the UPA Government have been as follows:

Year

Savings to GDP Ratio

Investment to GDP Ratio

2003-04

29.8

28.2

2004-05

31.8

32.2

2005-06

34.3

35.5

2006-07
(unrevised)

34.8

35.9

4. I expect that the figures for 2006-07, when revised, will also show an increase over original estimates.

5. In my view, the investment boom continues. I am confident that the economy will grow at close to 9 per cent in 2007-08.

6. For 2008-09, NCAER and CMIE, both well reputed institutions, have projected that the GDP growth rate will be 9.1 per cent.